Latest documents http://publikationen.ub.uni-frankfurt.de/index/index/ Sun, 04 Mar 2012 15:49:27 +0200 Sun, 04 Mar 2012 15:49:27 +0200 http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/24083 How do changes in market structure affect the US business cycle? We estimate a monetary DSGE model with endogenous …rm/product entry and a translog expenditure function by Bayesian methods. The dynamics of net business formation allow us to identify the 'competition effect', by which desired price markups and inflation decrease when entry rises. We …find that a 1 percent increase in the number of competitors lowers desired markups by 0.18 percent. Most of the cyclical variability in inflation is driven by markup fluctuations due to sticky prices or exogenous shocks rather than endogenous changes in desired markups. Vivien Lewis; Arnoud Stevens workingpaper http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/24083 Tue, 03 Apr 2012 15:49:27 +0200